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Netflix 2020 Product Strategy An Intro to Product Strategy with Gibson Biddle, Mike Belsito, and Industry Welcome! We’ll start the “main event” a few minutes after the hour: ● 10 am PT, 1:00 pm ET. Get ready for some fun! @gibsonbiddle @gibsonbiddle @gibsonbiddle May 14, 2020, 9:30-3:00 ET Fast-paced learning experience through a combination of Slido, Google Slides, and Zoom 5 strategy models plus simulated Quarterly Prod Strat Mtg Main room plus breakout room with 3-5 peeps Bring teammates to work on your own product For most, you’ll work on a product you know and love Develop strategic thinking and leaderships skills. @gibsonbiddle Product Strategy Workshop @gibsonbiddle “I loved the hands-on working sessions to define product strategy. Very interactive, real-world stuff” Nancy Anderson, PM, VetSource. “...really liked the personal involvement of Gib in our specific presentation and the ability to work with him in an all-group setting.” Magda Kura, Sr. PM, Kind Foundation. @gibsonbiddle Juicy quotes from 4/16 workshop @gibsonbiddle “I loved the domain expertise, format, and frameworks.” Vikram Desai, VP Product, Relay Networks “It was a small group so it felt very personal. Great content and highly interactive.” Beth LaPensee, Sr. PM, Ithaka “I really enjoyed putting the strategy frameworks into practice in a step by step way.” James Dorsch @gibsonbiddle Juicy... @gibsonbiddle Public: 5/14: Product Strategy Self-paced Product Strategy Course on Teachable @gibsonbiddle Workshops @gibsonbiddle https://www.eventbrite.com/e/product-strategy-industry-virtual-product-workshop-tickets-100688182063?aff=erelpanelorg https://www.eventbrite.com/e/product-strategy-industry-virtual-product-workshop-tickets-100688182063?aff=erelpanelorg PDF available at www.gibsonbiddle.com @gibsonbiddle @gibsonbiddle Gibson Biddle Industry May 8, 2020 @gibsonbiddle Elmo’s Preschool @gibsonbiddle @gibsonbiddle @gibsonbiddle The Learning Company Mattel @gibsonbiddle @gibsonbiddle Mattel’s sale of The Learning Company ends a @gibsonbiddle $3.6B disaster concluding one of the worst acquisitions of all time.” Andrew Cave The Daily Telegraph 9/30/2000 @gibsonbiddle @gibsonbiddle Netflix Speaker, Teacher, Writer, Adviser (2015) CPO, Chegg (2010) VP Product, Netflix (2005) SVP, Creative Wonders,The Learning Company, Mattel (1995) Director, Product, Electronic Arts (1991) Gibson Biddle @gibsonbiddle Netflix’s 2020 Product Strategy Frameworks Netflix Product Strategy Two Modern-day Netflix cases @gibsonbiddle Yes No. @gibsonbiddle Launch Netflix Party? @gibsonbiddle @gibsonbiddle Yes No. @gibsonbiddle Launch Custom Playback Speed? @gibsonbiddle @gibsonbiddle Frameworks @gibsonbiddle Strategy A route to continuing power in a significant market.” Hamilton Helmer @gibsonbiddle @gibsonbiddle Why strategy? The “What” v. “How” Communicate an inspired vision of the future Form hypotheses to DHM Enable saying “NO” (a lot) Facilitate prioritization Communicate a plan. Frameworks @gibsonbiddle GLEe DHM GEM SMT Roadmap / Description Get big, Lead, Expand Delight, H2C, Margin Growth, Engage, Monetize Strategy, Metrics, Tactics 4-Quarter rolling plan Frameworks @gibsonbiddle GLEe DHM GEM SMT Roadmap / Purpose Long-term product vision Hypotheses to compete LT Cross-functional alignment Hypothesis & metrics focus Describe how things fit together DescriptionFramework Purpose @gibsonbiddle GLEe DHM GEM SMT Roadmap Get big. Lead, Expand Delight, H2C, Margin Growth, Engage, Monetize Strategy, Metrics, Tactics 4-Quarter rolling Long-term product vision Build competitive advantage Cross-functional alignment Hypothesis & metrics driven How things fit together @gibsonbiddle The product leader’s job: ● Delight customers in ● Hard to copy ● Margin-enhancing ways. DHM framework Convenience, selection, value Instant streaming “Anytime, anywhere” Easy to find & play great videos Original content @gibsonbiddle Delight Margin-enhancing “All You Can Eat” subscription Price & plan tests @gibsonbiddle “Right-size” original content investment What makes hard to copy? @gibsonbiddle Hard to copy @gibsonbiddle Hard to copy @gibsonbiddle Hard to copy @gibsonbiddle @gibsonbiddle What’s hard to copy about Netflix? @gibsonbiddle @gibsonbiddle Hard to copy @gibsonbiddle Brand Unique technology Network effect Economies of scale / Examples “Movie enjoyment made easy” Personalization Device ecosystem Original content Netflix Product Strategy @gibsonbiddle Hello @gibsonbiddle @gibsonbiddle Netflix 2020 Gibson Biddle Netflix is a movie subscription service that delivers fast, easy entertainment in a friendly, straightforward way. @gibsonbiddle “Movie Enjoyment Made Easy” 1. Get big on DVD 2. Lead Streaming 3. Expand Worldwide 4. Original Content 5. Interactive Stories @gibsonbiddle Product Vision The product team’s high-level engagement metric is monthly retention. @gibsonbiddle Priority Metric Growth YOY member growth (20%) Monetization Lifetime value ($170)Gross margin (30%) Engagement Monthly retention (2% cancel) GEM priority @gibsonbiddle Strategy/Metric/Tactics Strategy Metric Tactic / project Personalization RMSE (delta between expected an actual rating) Mood algorithm test, Voice ID, Movie Personality Quiz, Language detection. Original Content % of members who watch at least 10 hours/month of Original Content Cold-start merchandising test, weekly release test, episodic micro-docs Watching experience % of customers who watch at least 30 hours/month Ultra HD, custom playback speed, shared viewing, lipsynch algorithms (40 languages) Interactive storytelling % of members who watch at least one hour interactive content per month. Support for real-timing branching prototyping, Kimmy Schmidt launch. @gibsonbiddle 2020 Rolling Roadmap Strategy Q2 Q3 Q4 Q1 Personalization Mood algorithm test Voice recognition Language detection “Movie Personality Quiz” Original Content Cold-start merch system Weekly Release Test Support for episodic micro-docs Expert Panel forecasting Watching experience Shared viewing Custom playback speed Automated lip-synch in 40 languages Ultra HD, Custom mobile encodes Interactive storytelling Voice activated decisions Real-time branching prototype tool Kimmy Schmidt launch Bandersnatch #2 @gibsonbiddle Thank you! @gibsonbiddle Two modern-day cases @gibsonbiddle C A S E 1 Netflix Party @gibsonbiddle Netflix Party @gibsonbiddle @gibsonbiddle Netflix Party @gibsonbiddle Netflix social Consumer insight Killed: ● “Friends” in 2009 ● XBox Party Mode in 2010 ● “Tell a Friend” in 2018 Insight: ● Your friends have bad taste ● You have many “guilty pleasures.” @gibsonbiddle Today Netflix Party “Netflix Party” grew from 500K to 1M in last 30 days Can launch “Party” on laptop next month All mobile/TV devices by end of year Will this delight in hard-to-copy, margin-enhancing ways? Should Netflix try social again? @gibsonbiddle @gibsonbiddle Launch or Don’t launch @gibsonbiddle Launch Netflix Party? @gibsonbiddle @gibsonbiddle @gibsonbiddle Launch or Don’t launch @gibsonbiddle Launch or Don’t launch We are freaks! Netflix Party learnings The power of “NO” >>> Simplicity With no “D,” there’s no “H” or “M” Netflix = “Movie enjoyment made easy.” @gibsonbiddle C A S E 2 Custom Playback Speed @gibsonbiddle @gibsonbiddle @gibsonbiddle @gibsonbiddle Frequent customer request Pioneered by YouTube & podcasts Test or no test? Studio response? Consumer insight @gibsonbiddle Gay on Main Street @HomoChuhunkyFunky OK, Boomer! Netflix, don’t make me call every director & show creator on Earthto fight you. I will win.” Judd Apatow, Filmmaker Knocked Up, SuperBad, 40 Year-old Virgin. @gibsonbiddle There is NO WAY Netflix will move forward with this. That would mean they are taking control of other’s art and destroying it.” Aaron Paul, Actor @gibsonbiddle @gibsonbiddle Consumer insight Frequent customer request Pioneered by YouTube & podcasts Test or no test? Studio response? Metrics to evaluate success? Delight Customers in H2C, Margin-enhancing ways? Yes No. @gibsonbiddle Launch Custom Playback Speed? @gibsonbiddle @gibsonbiddle Launch or Don’t launch @gibsonbiddle Launch or Don’t launch @gibsonbiddle Customer obsession Playback speed learnings Delight in H2C, Margin-enhancing ways Tightly aligned, loosely coupled Creative destruction. @gibsonbiddle Conclusions @gibsonbiddle Strategy @gibsonbiddle “A route to continuing power in a significant market.” Strategies = hypotheses to DHM Frameworks enable you to combine discipline & chaos To communicate an inspired vision of the future. If you want to build a ship, don’t drum up the people to gather wood, divide the work and give orders. Teach them to yearn for the vast and endless sea.” Antoine de Saint Exupery The Petite Prince @gibsonbiddle @gibsonbiddle @gibsonbiddle @gibsonbiddle @gibsonbiddle @gibsonbiddle www.gibsonbiddle.com/industry Complete Net Promoter Score survey Download PDF of presentation “How to Define Your Product Strategy” Series Teachable Product Strategy Course @gibsonbiddle @gibsonbiddle @gibsonbiddle May 14, 2020, 9:30-3:00 ET Questions? @gibsonbiddle @gibsonbiddle @gibsonbiddle @gibsonbiddle Appendix Net Promoter Score survey (click here) Sign up for the May 14 “Product Strategy Workshop” with Industry How to Define Your Product Strategy series on Medium (click here) www.gibsonbiddle.com https://www.surveymonkey.com/r/Nflx2020ProdStratIndustry https://www.eventbrite.com/e/product-strategy-industry-virtual-product-workshop-tickets-100688182063?aff=erelpanelorg https://medium.com/@gibsonbiddle/intro-to-product-strategy-60bdf72b17e3?source=friends_link&sk=7e94b5c6b7e35357359b31e823d6005d http://www.gibsonbiddle.com Public: 5/14: Product Strategy Self-paced Product Strategy Course on Teachable @gibsonbiddle Workshop @gibsonbiddle https://www.eventbrite.com/e/product-strategy-industry-virtual-product-workshop-tickets-100688182063?aff=erelpanelorg https://www.eventbrite.com/e/product-strategy-industry-virtual-product-workshop-tickets-100688182063?aff=erelpanelorg
